Free Essay On Advantages And Disadvantages Of Darden’s Supply Chains
Type of paper: Essay
Topic: Business, Restaurants, Supply, Products, Supply Chain, Time, Food, Advantage
It is known that a system of flawless day-to-day logistics is a key element of any business striving for having competitive advantage on the market. This paper examines the use of different supply chains and explores their good and bad points as well as describes complications that may occur whilst using them.
Darden Restaurants has developed strong supply chains allowing it to provide its restaurants with all the necessary products while taking account of their product life and differing shipment specifications. Such approach to the supplies makes it possible to offer the highest quality of meals and thereby attract more visitors. This is particularly noticeable given the popularity of Darden's restaurants. Darden has focused on the development of four supply chains, each of them covering a particular group of products needed in the daily operation of the restaurants.
The main advantage of the first supply chain which is employed to provide restaurants with all the necessary items apart from food products is that Darden initially gets all the items at his warehouse from which they can be sent directly to any of its restaurants, at any time and under any circumstances. This removes the need of having excessive inventories within the restaurants and at the same time gives the same flexibility. However, the drawback of this method include its relatively high reliance on trucking companies, whose work may be disrupted because of the inner problems that could affect Darden Restaurants; and supposedly long distances that have to be passed to bring the items from the warehouse to one of the restaurants.
The second supply line makes it possible for Darden to keep all the frozen, dry, and canned food products close to the restaurants, since it comprises eleven distribution centers all over the North America. Moreover, all the centers are managed by the biggest American food suppliers which saves Darden from the necessity to maintain and control even more spaces.
Obviously, fresh products seem to be the most difficult to keep and transport from one place to another due to their short product lives and sensitivity to natural conditions. Therefore Darden’s choice to use B2B supply line for these kinds of products looks the most logical because this way the time of delivery is shortened to the minimum, the price of the products is also reduced, as long as they are bought in large quantities, and finally the risks are minimized since there are only two parties involved – the preselected supplier and the restaurant.
Darden’s fourth supply chain is the most sophisticated one as it requires international communication and cooperation, advanced logistics and well-trained staff. But the result is worth it. Using this supply chain Darden could ensure that the restaurants always receive the freshest seafood despite any weather conditions, and that it is delivered directly to the restaurant as soon as possible after the catch. This enables Darden Restaurants to include seafood in the menus the whole year which can be seen as a direct competitive advantage.
Nevertheless, keeping four supply chains at once is not an easy thing to do because the more intermediaries there are in the process of delivering products from their producer to the restaurant, the more dependent is Darden’s business on them. It is a double-edged sword actually as on the one side you diversify supply methods and make logistics more efficient, but on the other side you become more exposed to the problems that may occur with one of your suppliers. Passing responsibilities down the chain also presupposes greater control and coordination and thereby more effort has to be put in order to manage all the daily operations.
Taking everything into consideration, it seems clear that using multiple supply chains has more benefits than drawbacks, though all the aforementioned complications have to be considered prior to selecting the supply strategy of the company. However, a more thorough research might be needed in order to justify the ideas expressed in the paper.